Why Tesla Inc (NASDAQ:TSLA) Rebuffed Uber’s Overtures Last Year?

Tesla Inc (NASDAQ:TSLA)’s CEO, Elon Musk, has rebuffed Uber’s overtures last year for a possible partnership on autonomous cars. Uber Technologies CEO, Travis Kalanick, was under pressure to reach some kind of a deal after Apple Inc. (NASDAQ:AAPL) made its investments in China-based Didi Chuxing, which is a rival.

In a book, Kalanick indicated that he wanted to align with Tesla’s Musk to compete against Apple, Bloomberg reported. For that purpose, he conveyed his wish to Musk saying that they should partner. Recalling the event, he revealed that the rest of the talk was done by Musk as the later was trying to convince him that it was not a realistic one and that he should focus on what he is doing currently.

At that point of time, both Uber Technologies and Tesla were working on their plans to roll out semi-autonomous driving system Autopilot to their vehicles. Uber was working with its own technology for self –driving while electric vehicle maker was doing its best on the same project.

Kalanick realized that driverless car is a big priority for Tesla when his top executives learnt it from the electric vehicle manufacturer. He also felt that Musk was playing coy with him.

Some days after the conversation, Musk rolled out a ten-year program for the company. That included a proposal of ride-hailing service much similar to that of Uber enabling Tesla vehicle owners to earn money by renting out their robocars. Though Elon rebuffed the alliance offer, his close aide has reportedly indicated that Musk did not persuaded against on driver-less cars.

Uber was keen on alliance since it has partnerships with Daimler AG, as well as, Volvo for driverless cars. Aside from that Kalanick has admired Tesla and its CEO. Interestingly, Kalanick was ready to buy 500,000 autonomous vehicles from Tesla by the end of the decade. Ultimately, Uber decided to sell its Chinese unit to Didi.

As Uber is facing several issues currently including its legal battle with Alphabet Inc (NASDAQ:GOOGL)’s autonomous car division, Tesla is trying to gain confidence from senior management of Uber, as well as, investors. It was quite clear that any alliance with Uber would have meant that Tesla would have had to compromise either in China or globally, which Musk did not want.

On Tuesday, Tesha shares edged up 0.38 percent in regular trading hours but shed 0.48 percent in pre-market on Wednesday.

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